Peter Thiel vs Gawker: A Cautionary Tale About Money and Megalomania

Peter Thiel, the Silicon Valley mogul, has been waging a vendetta against Gawker using the courts, in what amounts to a clear abuse of process that threatens free speech and society as a whole. (Photo by Neilson Barnard/Getty Images)

Peter Thiel has accomplished some pretty amazing things. Let’s get that out of the way right off the bat. He co-founded PayPal, the online payment system, and was one of the first Facebook investors. For that he was richly rewarded. But today, he’s the biggest threat to society since the Red Scare.

Thiel is a well known in Silicon Valley as an entrepreneur, venture capitalist and hedge fund manager. But to the average American, he’s nameless and faceless.

Thiel is far from the first person exposed by the media for one thing or another. As the old journalism saying goes, “afflict the comfortable and comfort the afflicted.” But he’s different in one big way.

He’s worth a reported $2.7 billion, and he’s been using his vast wealth in what The New York Times described as a “clandestine war” to punish, and ultimately silence Gawker.

“It’s less about revenge and more about specific deterrence,” he told The Times.

His vision of the news media, and more specifically the business news media, is grounded in notions that date to 1950s. Back then, reporters were dictationists. They wrote what they were told by people in positions of power and looked no further.

That journalistic mindset paved the way for Sen. Joe McCarthy and the 1950s Red Scare, one of the darkest periods in American history.

At the height of the Cold War, McCarthy claimed Communists had widely infiltrated government and other institutions, including Hollywood and the news media. The hysteria that followed had a chilling effect on society unseen before or since.

It took a journalist the caliber of Edward R. Murrow to finally called McCarthy’s bluff, leading to his self-destruction in what became known as the Army-McCarthy Hearings in Congress.

There could be no more free passes for government officials. Because of their vast power over ordinary citizens, their lives, both public and private, became fair game for media scrutiny.

It took a while for business journalism to catch up. But it became clear in the 1960s and 1970s that corporations and the people who run them hold the same vast power to dramatically affect our daily lives.

Today, they’re held to the same standard as government officials, celebrities, sports figures and anyone else with disproportionate power to influence society.

The concept may be evolutionary, but it is grounded in the First Amendment and has been upheld by various Supreme Court rulings over the years.

Now cut to the present. Denton is certainly no Edward R. Murrow and Thiel is no Joe McCarthy. But the exact same issues are in play.

Civil courts are really meant to be forums of last resort. They resolve legal grievances that can’t otherwise be resolved. But Thiel isn’t about resolving grievances.

His using his vast wealth to underwrite lawsuits against Gawker to bleed the Web site financially, curb its reporting style and, ultimately, put it out of business.

As such, his vendetta amounts to what may be the biggest abuse of process in the nation’s judicial history.

But there’s more. Like McCarthyism, Thiel’s actions threaten to have a serious, chilling effect on the news media, free speech and society as a whole.

If he prevails in his actions, it will send a clear message. Anyone with a vindictive personality and deep pockets can use the courts to threaten financial ruin, regardless of the legal merits of any case they bring.

He’s certainly not the first to go this route, but the sheer depth of his abuse is staggering.

Speaking of legal merits, the Hogan verdict, which resulted in a $140 million award, has none. The case ultimately will be overturned on appeal. The issue was actually settled in 1988 by the landmark Supreme Court case, Hustler Magazine, Inc. v. Falwell.

But the outcome of the Hogan case means nothing to Thiel.

Win or lose, he’s accomplished his goal–to punish Gawker , push it closer to bankruptcy and send a message to the rest of the media. Layoff covering him and his Silicon Valley pals with the scrutiny they deserve–or else.

As legal scholars have long noted, the First Amendment is meaningless if only protects lofty discourse and not speech that some may find titillating, off-color or offensive.

Let’s hope the courts see Thiel’s actions for what they are–a gross abuse of process to grind an axe. Rest assured, there’s no justice in that.

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